DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part of the
legislative instrument. The keyword, one-liner, abstract, and digest do not constitute part of the law
or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
HB 494 Engrossed 2019 Regular Session Abramson
Abstract: Determines the political subdivision entitled to sales and use taxes on sales of raw
materials converted into asphaltic concrete for use by a road contractor to fulfill a road
material construction contract.
Proposed law requires, for purposes of determining the political subdivision entitled to local sales
and use tax, local sales and use taxes to be paid for sales of raw materials converted into asphaltic
concrete documented for ultimate use by the road contractor pursuant to a road material construction
contract as follows:
(1)If the raw materials are purchased from a La. dealer and title or possession transfers to the
road contractor at the dealer's place of business, sales tax is due in the taxing jurisdiction of
the dealer.
(2)If the raw materials are delivered to the road contractor and title or possession transfers at the
road contractor's facility where the raw materials are converted into asphaltic concrete, the
"retail sale" of the raw materials is deemed to occur where the asphaltic concrete is ultimately
used by the contractor to fulfill the road material contract.
(3)The exercise of any right or power over raw materials imported into a taxing jurisdiction for
conversion into asphaltic concrete shall be deemed to be a "use" in the taxing jurisdiction in
which the asphaltic concrete is ultimately used by the road contractor to fulfill the road
material contract.
Proposed law prohibits local sales or use taxes from being due to the taxing jurisdiction where the
road contractor converts the raw materials into asphaltic concrete unless any of the following occurs
in the taxing jurisdiction:
(1)The road contractor purchases raw materials from a dealer and title or possession transfers
to the road contractor at the dealer's place of business in the taxing jurisdiction where the
road contractor converts the raw materials into asphaltic concrete.
(2)The asphaltic concrete is ultimately used by the road contractor to fulfill a road material
contract in the taxing jurisdiction in which the road contractor converts the raw materials into
asphaltic concrete.
(3)The road contractor makes a taxable sale of asphaltic concrete to a third party such that title or possession, or both, transfers to the purchaser in the taxing jurisdiction in which the road
contractor converts the raw materials into asphaltic concrete.
Effective upon signature of governor or lapse of time for gubernatorial action.
(Adds R.S. 47:337.12.1) Summary of Amendments Adopted by House
The Committee Amendments Proposed by House Committee on Ways and Means to the original
bill:
1. Change references in proposed law from the manufacturing of asphaltic materials to the
conversion of raw materials into asphaltic materials.
2. Change references in proposed law from a "manufacturer" to a "road contractor".
3. Clarify that if raw materials are purchased from a La. dealer and title or possession
transfers to the road contractor at the dealer's place of business, sales tax is due in the
taxing jurisdiction of the dealer.